Written answers
Wednesday, 12 June 2013
Department of Finance
Mortgage Interest Rates Issues
John Lyons (Dublin North West, Labour)
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78. To ask the Minister for Finance his views on the recent interest rate increase on variable rate mortgages by a bank (details supplied); and if he will make a statement on the matter. [28194/13]
Michael Noonan (Limerick City, Fine Gael)
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I, as Minister for Finance, have no statutory role in relation to the variable mortgage interest rates charged by regulated financial institutions. It is a commercial matter for the banks concerned. The mortgage interest rates that financial institutions operating in Ireland charge to customers are determined as a result of a commercial decision by the institutions concerned. This interest rate is determined taking into account a broad range of factors, including European Central Bank base rates, deposit rates, market funding costs, the competitive environment and an institution’s overall funding arrangements.
However, as part of the Central Bank’s work on mortgage arrears, lenders were asked to consider all avenues to help customers in arrears, including interest rate reductions. Currently, several lenders do consider a temporary interest rate reduction but this is on a case by case basis.
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